Baltimore dock union facing takeover amid contract talks

Potential seizure by national chapter over financial woes, infighting could affect port

April 19, 2014|By Kevin Rector, The Baltimore Sun

The last financial filing that Local 333 submitted is for fiscal year 2012, when the local reported about $1.1 million in total receipts and nearly $2 million in net assets, according to the Labor Department website.

McKenzie declined to speak to a reporter when reached for this article, and other members of the Local 333 executive board did not respond to an email sent to a Local 333 media account. The union's attorney, Jennifer Stair, did not reply to a request for comment.

The committee also noted a personal bank account set up by McKenzie under the name ILAA, and said it "raises unnecessary concerns" because of the similarity to the union name.

McKenzie "did not dispute that he had set up his account this way," the committee wrote, but "could not explain what the initials 'ILAA' stood for."

According to the Maryland Department of Assessments and Taxation, McKenzie is listed as the primary owner of a company named ILAA that is registered through November 2015. When he filed for and was awarded the ILAA trade name in November 2010, he described the business as "human services consulting and referrals of clients for needed resources," according to online records.

In separate Chapter 13 personal bankruptcy filings, an ongoing proceeding, McKenzie listed ILAA Travel Agency as a business holding between 2003 and 2007.

The committee found that McKenzie had maintained the ILAA bank account even though a separate ILA committee had directed him in 2010 to place it under his own name, according to the report. The committee ordered McKenzie to immediately close the account.

The committee also found that union debit cards "had been used many times for items that were clearly unrelated to union business," that vague card statements made it impossible to determine the reason for other expenses, and that the entire debit card system was a "recipe for disaster," according to the report.

The committee noted that a previous internal audit by Local 333 had difficulty documenting $5,000 in debit card charges and could not account for $2,000 more, according to the report. It was unclear whether the discrepancies were simply due to poor record-keeping.

In addition, the committee identified a $1,600 charge that Wilburn made on a union debit card during a trip to Las Vegas, noting that it "found it ironic that Wilburn had brought charges about the misuse of union funds when he himself was guilty of one of the more egregious examples."

Wilburn said in an interview that he used his union debit card in Las Vegas because he had forgotten his own credit card and later repaid the money.

Wilburn took his complaints about Local 333's operations to the international to help save it, he told The Sun, adding, "The best thing that has happened to this local is that the international has stepped in."

Wilburn said he can't explain the problems noted in the internal audit, which he said was conducted by other members of the executive board without his assistance. He said his access to the local's financial records was cut off after he was suspended from office by McKenzie and other Local 333 officials, restored by the local's membership and then removed once more by officials — all in the past six months.

Beyond requiring the outside audit, the trusteeship committee issued several other recommendations, including that Local 333 immediately terminate all debit cards drawn on its bank accounts. The local was also told to eliminate advances of prepaid debit cards and meal and travel per diems in favor of a reimbursement system.

If the international were to decide to establish a trusteeship over Local 333, it would be removing the union's hometown leaders from office just as they are trying to secure a new local contract with employers at the port.

Such a move would add yet another wrinkle to what is already a complex contract negotiation with multiple stakeholders, millions of dollars at issue and a long trail of brinkmanship. But the ultimate impact remains unclear, labor experts say.

The international has expressed solidarity with Local 333 in the contract fight, so the effect of a trusteeship could be strictly managerial, said Philip Dine, writer of "State of the Unions," a look at how local unions regain influence in a modern economy.

At the same time, Dine said, Local 333 has a reputation for being tough and scrappy in negotiations. The national organization has a reputation as a powerful union "that doesn't necessarily use that power all the time" in pushing negotiations to the limit, he said.

"They're not known as sort of a rash or brash union," Dine said. "They stand up for their members, but they do try to work with their employers."

Marrinan, the national ILA attorney, said the process is working as it should. The committee has not made any decisions since issuing its findings and is awaiting information, including the outside audit, before making a final decision on a trusteeship.